From leaders of countries to leaders in business, there are bright stars that we can learn from during this challenging time in history.
One of those leaders is Corie Barry, Best Buy’s 44-year-old CEO and one of the youngest CEOs of an S&P 500 company as well as one of the few women who lead Fortune 500 companies.
Under Barry’s leadership, Best Buy adopted a temporary enhanced curbside-service-only model starting March 22, during which time all in-home deliveries, installations, and repairs were suspended—a decision made for the health and safety of both Best Buy customers and employees. The model was successfully implemented within just 48 hours across Best Buy’s entire store base.
Since adopting its enhanced curbside service model despite all its domestic stores being closed to customer traffic, with approximately 40 (particularly in the Northeast) having been completely closed to all business for at least 10 days at its discretion, Best Buy has retained about 70% of its sales—something that Barry calls “a testament to the strength of our multi-channel capabilities.” Best Buy’s Domestic online sales are up over 250%, with approximately 50% from customers choosing to pick up their products at the stores since the shift to the curbside service model.
Since early days of the pandemic, Barry has led the company in making the following decisions related to its employees: Best Buy employees do not have to work if they do not feel comfortable and should stay home if they are feeling sick—without losing their pay. All retail and field employees whose hours were cut by the shift to the curbside service model are being paid for their regularly scheduled hours through April 18.
Faced with a very fluid situation, Barry is leading Best Buy to take the following actions:
- Beginning April 19, the company is putting approximately 51,000 Domestic hourly store employees, including nearly all part-time employees on temporary furlough, while retaining approximately 82% of its full-time store and field employees on its payroll, including the vast majority of In-Home Advisors and Geek Squad Agents. Furloughed employees will retain their health benefits at no cost to them for a minimum of three months.
- Beginning April 19, some corporate employees are participating in voluntary reduced work weeks and resulting pay, as well as voluntary furloughs.
- Barry herself will forego 50% of her base salary and the members of the Board of Directors will forego 50% of their cash retainer fees through at least September 1, 2020.
- Company executives reporting directly to the CEO will take a 20% reduction in base salary through at least September 1, 2020.
In addition, Best Buy has decided on the following measures:
- Lowered merchandise receipts to match demand with a focus on essential items for customers
- Extended payment terms in partnership with key merchandising vendors
- Reduced promotional and marketing spend aligned to temporary operating model
- Decreased capital spend to focus on mandatory maintenance or high-value strategic areas
- Suspended 401(k) company matching program
To help employees deal with the financial impact of the COVID pandemic, Best Buy, has partnered with its founder, Dick Schulze, to establish a $10 million employee assistance fund, available to all part- and full-time hourly employees who have been with the company longer than one year. The fund was created with equal shares from Best Buy and Mr. Schulze, with the company’s portion being paid by repurposing the majority of its annual corporate giving budget.
Despite the toll of having to make painful decisions, Barry is not buckling and is looking ahead to a return to normalcy: “We are taking the steps necessary to resume providing our customers in-home services in the near future, keeping in mind our overriding priority on the safety of our employees and customers. We are also preparing to re-open stores to customers as soon as it is safe to do so, with timing likely to vary at state and local levels. In the meantime, as you would expect, we are focused on making the difficult decisions necessary to ensure that at the end of this crisis Best Buy remains a strong, vibrant company.”